Chinese Airline Industry
The growth predicted for China's aviation sector is startling
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Even by the standards of China, the growth predicted for the aviation sector is startling.
The combined fleet of the state-run airlines, currently about 2,600 aircraft, is expected to grow to 4,500 within five years.
The number of air passengers travelling internationally from the country is predicted to rise by 10.8 per cent a year until 2014, according to the International Air Transport Association (Iata), while cargo volumes are expected to increase even faster, at 12.2 per cent annually.
"The economic growth in China as well as in the Asia-Pacific area is [causing] tremendous increases in demand for aviation transportation," says Dennis Fan, a member of the Aviation Policy and Research Center at the Chinese University of Hong Kong.
The Iata forecast, issued this year, said that of the 800 million extra passengers expected to take to the skies globally by 2014, more than a quarter would be in China.
The big-three state-run carriers, Air China, China Eastern Airlines and China Southern Airlines, along with Hainan Airlines, the country's fourth carrier in terms of size as well as being the country's largest privately owned transport firm, are all set for significant expansion.
Yet that is not to say growth will always be easy to achieve. The industry has long since reached international safety standards, but other challenges remain.
In particular, the expansion of China's network of high-speed trains has created a headache for carriers when it comes to domestic routes, even if the authorities have decided to slow the rate of expansion of railway lines amid concerns about safety and excess capacity.
Carriers plying some air routes, notably between Beijing and Shanghai, have had to cut prices as a result of growing competition from fast trains, while other routes have closed.
When it comes to international services, the magazine Airline Leadernoted China's airlines often lack the flight frequency of their overseas rivals. On routes between the US and China, for example, Chinese carriers run only about half the number of flights that their US counterparts operate.
The magazine also noted the importance of strengthening the brands. Hainan Airlines has shown its determination to challenge the likes of Singapore Airlines and Qatar Airways in quality of service, having this year been named a five-star airline by Skytrax, an airline consultancy.
Yet, overall, the likes of Air China and China Southern Airlines are not spoken of as premium carriers in the way that Cathay Pacific, Emirates Airline and Etihad Airways often are.
Forming joint ventures with top airlines and allowing foreign interests to take minority stakes in ownership have been suggested by Airline Leader as ways to help China's top carriers to get closer to the world's best in quality.
Improving punctuality and reliability, especially on domestic services, where delays and cancellations are an acute problem, is a key objective.
Also, Chinese carriers often compare poorly with their international competitors on simple issues such as the user-friendliness of their websites.
Another area where Chinese aviation could be seen to be lagging behind parts of South East Asia and East Asia is in the low-cost sector.
Spring Airlines, which began operations in 2005 and is perhaps best known globally for a bizarre proposal a couple of years ago that standing-room tickets could be sold, is the sole representative.
The Shanghai-based airline provides domestic service as well as flights to Japan and China's special administrative regions of Macau and Hong Kong.
Contrast the existence of a single low-cost carrier in China with the handful of budget operators that South Korea, Japan, the Philippines and Singapore all have.
Regulatory approval is a key constraint on the low-cost sector's growth, and any growth will require China's civil aviation administration to liberalise the market.
Clement Chow, from the international business department at Hong Kong's Lingnan University and a member of the Chinese University of Hong Kong's aviation centre, cites a number of market factors as restricting particularly the growth of budget operators, as well as the high-speed trains.
In South East Asia, the most convenient way of travelling from Singapore to Kuala Lumpur or Bangkok is by air, "so the demand will be more important compared to mainland China," he says.
Another factor is the higher cargo volumes in mainland China compared with South East Asia. The narrow-body aircraft that low-cost carriers typically operate are less useful in the cargo market.
"In China, cargo is a big factor, and low-cost [airlines] are not really into cargo. The full-service carriers can benefit a lot from cargo. That will be helpful for them for their development," says Mr Chow.
Yet he does see scope for additional low-cost carriers.
"The market is growing very fast," he says.
Just as Chinese airlines expand their fleets and China advances plans for its own airliner, the C919, a home-grown rival to the Boeing 737 and the Airbus A320, the country is also embarked upon a dramatic expansion of its airport network.
Forty-five airports are due to be built over the next five years, even though the majority of the existing facilities lost money last year.
The expansion reflects predictions for growth and a belief that improving aviation links will spread more evenly the economic development that until now has been concentrated in China's eastern and southern coastal belts.
Yet, internationally at least, growth might be hampered in the near term as a result of the sluggish performance of developed economies.
"In the future, there may be a slowdown because the world economy is unstable," says Mr Chow. "The markets in North America and Europe are not doing well, and next year, air travel could be slowing, especially for cargo.
"But for the long term, demand for cargo and passengers will be very strong."